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As a startup owner, you may have always imagined expanding your startup to Asia. Now that time is here, and you can finally fulfil your dreams. In recent years, business expansion to Asia has become very common. Expanding to Asia has many benefits, such as a large customer base and the potential for your startup to grow further. So, once you overcome the language barriers, nothing can stop you from conquering Asia’s markets. This article will outline some key aspects to consider when expanding your startup to Asia. 

Choose Your Country

Asia is a vast continent, with lots of potential and many countries. To understand each country’s potential markets, you can obtain a market entry report. This report will outline:

  • market demographics;
  • competitors;
  • relevant pricing;
  • local customs;
  • regulations; and
  • incentives that may suit your business, such as high-skilled labour.

The market entry report can also outline the best way to enter certain markets. For example, you may be better off exporting to some markets, while others you should licence your services in. 

Along with analysing the market entry report, you can also consider your hopes for your startup and where you want to go. Furthermore, you can also determine where your product or service may fit into.

For example, if you own a high-tech startup, you may want to expand into technologically advancing countries like China and South Korea. 

Know the Culture

Cultural differences can affect how you market your products or deal with local staff. It is vital to research the local culture to smoothly integrate your business into the country and avoid future problems. 

For example, if you are expanding into Malaysia, a primarily Muslim country, you may need to alter your menu if you have a food-based startup. Most people in Malaysia will not eat pork or drink alcohol. Therefore, it may be beneficial for your startup to remove pork and alcohol from the menu to fit into cultural and religious etiquette.

Visa Requirements 

Each country will have visa requirements and processes that you must consider if you intend to have a local in-person presence. Thus, you will need to research your chosen country’s requirements. 

For example, Singapore offers an Entrepass visa for foreign entrepreneurs who want to start or relocate their business to Singapore. You will need to show proof of business activities and have a business plan. This visa will last for one year and can be renewed. 

To apply for the correct visa for your startup, you should contact the Immigration Department for your chosen country. 

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Hiring Talent

When expanding into a foreign region, you may need to hire local employees to help run and manage your business. However, attracting talent can be challenging as you need to convince potential employees to work for you rather than a local company that may have been there for years. In addition, you also may need to find employees who are fluent in both their native language and English to connect with potential customers and you better.

Once you have found the best talent and recruited them to be your employees, you will need to comply with the local employment laws. Asian employment laws will be different from New Zealand’s, so you must do careful research on this. For example, the minimum wage may be a lot higher than the New Zealand minimum wage, and you will need to consider this for your expenses. 

Entering the Market

Next, you need to choose an expansion strategy that will allow a seamless integration into the foreign country while minimising your costs. You can enter international markets by:

  • exporting your products and services into the Asian country;
  • franchising;
  • licensing the right to use your product or service to foreign businesses;
  • joint ventures with a local partner;
  • partnerships;
  • acquiring a foreign business; or
  • greenfield ventures or subsidiaries.

Preparing for Legal Obligations

In New Zealand, there are several consumer and commercial laws that you need to comply with when conducting business in New Zealand. Your chosen Asian country will have its own laws and regulations that you will need to abide by. You will need to get local advice to ensure your business complies with those laws and regulations. 

For example, your startup must comply with market competition regulations in Singapore. This law ensures that your startup maintains market competition for increased customer innovation and value. This law also prohibits you from merging or acquiring another company in Singapore that may lessen competition in Singapore markets. 

Key Takeaways

Expanding your startup to the Asia Pacific region can be exciting and worthwhile. However, during your expansion, you should:

  • choose your target countries carefully;
  • research the local culture;
  • research visa requirements;
  • begin to hire foreign talents and comply with employment laws;
  • decide on how you will enter the foreign market; and
  • prepare for legal obligations.

LegalVision cannot advise on expanding your New Zealand startup to Asia. However, if you have other general legal needs related to your startup, you can contact our experienced startup lawyers to assist as part of our LegalVision membership. You will have unlimited access to lawyers who can answer your questions and draft and review your documents for a low monthly fee. Call us today at 0800 005 570 or visit our membership page

Frequently Asked Questions

How can I choose the right country in Asia?

When choosing a country, you must consider where you want to lead your startup and for what reason. Therefore, you must understand what industry your startup is in and what employees you are looking for. To best understand the market potentials, you can acquire a market entry report which will give you a deep analysis of the markets you may want to expand into.

Do I need to research local culture?

Researching local culture is essential, and without this, your startup may fail in a foreign country. Asian countries often have a unique culture. For instance, in Japan, it is custom to bow when meeting someone for a business meeting as a sign of respect. By understanding local cultures and customary behaviours, you can adapt your startup in a way that will appeal to the local market. 

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